Detalle Publicación

ARTÍCULO
Economic uncertainty, oil prices, hedging and US stock returns of the airline industry
Título de la revista: THE NORTH AMERICAN JOURNAL OF ECONOMICS AND FINANCE
ISSN: 1062-9408
Volumen: 57
Páginas: 101388
Fecha de publicación: 2021
Lugar: WOS
Resumen:
This paper examines the impacts of economic policy uncertainty and oil price shocks on stock returns of U.S. airlines using both industry and firm-level data. Our empirical approach considers a structural vector-autoregressive model with variables recognized to be important for airline returns including jet fuel price volatility. Empirical results confirm that oil price increase, economic uncertainty and jet fuel price volatility have significantly adverse effect on real stock returns of airlines both at industry and at firm level. In addition, we also find that hedging future fuel purchase has statistically positive impact on the smaller airlines. Our results suggest policy implications for practitioners, managers of airline industry and commodity investors.